Should I hire my own salespeople or use a broker network?
Both. To effectively and economically service your customers and build your distribution, you will need to develop a first-rate broker network. You then need to have someone manage them. If you are a small company starting out, it is not unusual for that person to be the owner or founder. However, this is not sustainable given how vital the sales effort is alongside all the other functions that need attention. You will need to hire, titles aside, a sales manager who will drive your business—someone who eats, drinks, breathes sales, and spends much of their time on the road working with brokers and customers and visiting markets. As your business grows, it usually evolves into having regional managers managing brokers, distributors and customers in a given region.
Can I build my business without using a broker?
There are differing opinions as to the real worthof brokers. Generally speaking, there are few natural products companies who have become successful without using a broker. Most of the broker criticism comes from manufacturers that have failed to supply a quality product that meets a specific, sizable need or abject failures by manufacturers to work effectively with brokers. In most cases, it was the product that failed, not the broker. That said, it is important to find the right broker for your needs and work closely with them to keep them focused.
If you choose not to use brokers, you must develop an alternative means of communicating with the individual retail stores. This can be done through direct mail, telemarketing, and direct visits by your sales people. Natural product success stories are built one block at a time, and attention to detail at the individual store level is a must. You cannot “paint with broad strokes” in this industry unless you have a truly unique and mass-appeal product. We highly recommend finding the natural product broker that is the right fit for you.
The lifecycle of a sales organization
- Develop broker network.
- Owner/founder manages brokers.
- Hire sales manager to manage brokers.
- National Sales Manager hires East Coast Regional rep and West Coast Regional rep to manage brokers in respective regions—often East Coast Regional covers East Coast and Midwest, and West Coast Regional manages West Coast, Mountain States and Southwest. The National Sales Manager often works on national accounts and provides day-to-day direction and support of regionals.
- Hire East Coast, Central (Midwest, Southwest, Mountain States), and West Coast reps.
Obviously, as the business grows in each region, you may make the regions smaller so as to develop them more fully.
This content is excerpted from the Natural Products Field Manual, Sixth Edition, The Sales Manager’s Handbook, written by Bob Burke and Rich McKelvey. To learn more about or purchase the Natural Products Field Manual, visit the Natural Products Consulting Institute website.